Hamas leaders have been touring Arab states in recent days looking for financial backing after Israel and the United States said aid could not flow to a Hamas-led Palestinian government unless it recognised Israel's right to exist.

Hamas is also under pressure from the United States and Israel to renounce violence and live up to peace accords.

The State Department has begun a review af all U.S. aid to the Palestinians and is trying to work out how to continue the funding without giving assistance to Hamas. Israel on Sunday said it would halt monthly transfer of millions of dollars to the Palestinian Authority.

Iran also does not recognise Israel and has repeatedly called for the destruction of the Jewish state as the only solution to the conflict in the Middle East.